Java libraries existing in workspace not being used properly while compilation

[hemantasapkota]

1. Create a sample project.
2. Add an existing library to the project from other existing projects in the workspace. [In the Libraries tab of Java Build Path, Add a jar file using the Add JARs button.]
3. Refer to any of the classes of the added jar file and try to compile. The compilation should fail.

This mostly happens when the classpath entry has relative path entry, as shown in the image.

Thanks Bob Wood for finding the issue.